July 26 (Bloomberg) -- Foreclosure filings rose in almost
60 percent of large U.S. cities in the first half of 2012,
indicating many areas will have more distressed homes on the
market later this year, RealtyTrac Inc. reported.

More than 1 million homes in metropolitan areas with
populations of at least 200,000 received notices of default,
auction or repossession, up 1.5 percent from the last six months
of 2011, the Irvine, California-based data provider said today
in a statement. Among the 20 largest markets, Tampa, Florida;
Philadelphia; Chicago and New York City had the biggest
percentage increases in filings.

The gain in foreclosure actions followed a probe into
abusive lender practices that delayed bank seizures nationwide.
More repossessions will buoy deals “in many local markets where
a shortage of aggressively priced inventory has been holding up
sales,” RealtyTrac Chief Executive Officer Brandon Moore said
in the statement.

A $25 billion bank settlement announced Feb. 9 eased loan
terms for some borrowers and set new guidelines for the five
largest U.S. mortgage providers. Recent laws passed in Nevada
and California, meanwhile, have made it harder for loan
servicers to resume property seizures, Daren Blomquist, a
RealtyTrac spokesman, said in a telephone interview.

The new regulations have been “a clock-stopper on lenders
and led to more artificial decreases,” he said. Throughout the
U.S., first-half filings, while up from the previous six months,
were down almost 11 percent from a year earlier, RealtyTrac
said.

California Cities

Even with new California laws, seven metro areas in the
state ranked among the 10 highest for rates of foreclosure
fillings per household, according to the company. The top three
spots were held by Stockton, Modesto and Riverside, even as each
city posted lower totals than a year earlier. Phoenix and Las
Vegas also had decreasing tallies, while Atlanta filings rose
4.8 percent for the only gain among the top 10.

In Tampa, where filings gained 47 percent from the latter
half of last year, an 18-month backlog of bank-owned properties
is compounded by widespread negative equity, Blomquist said.
Almost half of residents in the area with a mortgage owe more
than their homes are worth, he said.

Chicago, where 46 percent of borrowers have negative
equity, has an aging inventory of “highly distressed inner-city
homes” and many homeowners with subprime loans, Blomquist said.
Investors scouring the U.S. for properties to fix up are
shunning those neighborhoods, he said.

Tight Supplies

Delayed seizures have contributed to tight supplies of
homes for sale. The number of U.S. single-family houses, condos,
townhomes and co-ops on the market last month dropped 19 percent
from a year earlier, according to the National Association of
Realtors’ website.

Across the nation, one in 126 households received a
foreclosure notice in the first half, RealtyTrac said. Of the
212 metro areas with at least 200,000 residents, 125 cities had
an increase in filings from the latter half of 2011.

Seattle had the biggest drop among the 20 largest metro
areas, with notices down 24 percent. Filings fell 21 percent in
San Francisco, 17 percent in Detroit, 13 percent in Los Angeles,
12 percent in Boston and 11 percent in San Diego, according to
RealtyTrac.

The company sells default data from more than 2,200
counties representing 90 percent of the U.S. population.